Saudi Arabia's independence requirement is the greater of two directors or one-third
Article 16 of the CMA Corporate Governance Regulations sets board size at three to eleven with a non-executive majority, and requires independent directors numbering at least two or one-third of the board, whichever is greater.
19 January 2023
The Companies Law promulgated by Royal Decree M/132 of 2022 came into force in January 2023 and modernised the corporate framework, including company forms, board duties and shareholder rights.
The CMA's Corporate Governance Regulations layer prescriptive composition rules on top for listed joint stock companies: a board of three to eleven, a majority non-executive, and the greater of two independent directors or one-third of the board. The audit committee runs to between three and five members, must include at least one independent director, may not include an executive director, and may not be chaired by the board chairman.
Board terms run for up to four years, after which directors stand for re-election and independence is reassessed.
What it means for a cross-border candidate
The four-year cycle is the timing fact that governs everything else. Appointments cluster around the election, so an approach made two years into a term is usually an approach about a casual vacancy or about the next cycle — which is a completely different conversation from the one most candidates think they are having. Ask which of the two it is at the outset.
This paragraph is the Global ID Exchange’s own reading, not a statement by any authority named above. Everything in the body of this item is a matter of record; this is judgement.
Sources
- Companies Law, Royal Decree M/132 of 2022 (in force January 2023)
- CMA Corporate Governance Regulations, Art. 16 and audit-committee provisions
Rules change and transitional provisions frequently apply. Verify against the primary instrument before you rely on any provision described here.
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